In its monthly manufacturing outlook survey, the Dallas Fed found 35 percent of manufacturers reported production increases this month — the highest percentage since March 2011. Additionally, new orders reached levels not seen since May 2010, with 36 percent of business executives reporting an increase in new orders in June.

The Dallas Fed also found that stronger factory activity fueled steady labor demand and longer workweeks, as more survey respondents anticipated an improvement in general business activity over the next six months.

Nearly 100 Texas manufacturers responded to the survey between June 11 and 19. The Dallas Fed will release its next report July 29.